The major national consumer protection legislation is now called the Commonwealth Australian Consumer Law which is contained in the Competition and Consumer Act 2010. The start date for this law is 1 January 2011. Different states have embodied this into state specific laws, for example Victoria, the relevant law is the Australian Consumer Law and Fair Trading Act 2012.

Misleading conductIt is illegal for traders to take part in misleading conduct in advertising or pre-contractual negotiations or following the purchase. For example:

statements that a product is less expensive than a comparable product when this is not true; and

guarantees of results that have not been proven;

Other Unfair PracticesThe law also prohibits other unfair practices such as:

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conduct that is unconscionable - issues to be considered include the relative bargaining positions of the consumer and trader, whether the consumer was able to understand any relevant documents, whether there were any unfair tactics used;

making false representations about the quality or standard of services;

making false or misleading representations about fees or charges;

conduct that misleads about the nature, the characteristics and the suitability of the services; and

physical force, undue harassment or coercion of a consumer resident in relation to payment of any fees or charges

Consumer guaranteesThis law also creates guarantees into some consumer contracts. This is a statutory guarantee which is different to any guarantees that may be included in the contract.

Goods must be of acceptable quality and be fit for any disclosed purpose.

Acceptable quality - goodsGoods must be of ‘acceptable quality’. This means that they must be fit for the purpose that they are commonly supplied for, they are acceptable in appearance and finish; free from defects and are safe and durable.

Issues to be considered will include the nature and price of the goods and any statements made about the goods.

Due care and skill - servicesServices must be carried out with due care and skill, be reasonably fit for the purpose advised by the consumer and be supplied within a reasonable time.

Legal remediesThe new law sets out specific remedies available to the consumer where there is a breach of a statutory consumer guarantee. In essence, the law distinguishes between a major and minor failure.

A "major failure" is defined in the law as:

a failure whereby the goods or services are unsafe;

where there is no remedy within a reasonable time frame;

where the goods or services are significantly different from what was described or a sample; or

where the goods or services would not have been purchased by a reasonable consumer if they had known about the fault.

If the fault is a minor failure or can be remedied, you can ask the supplier to repair, exchange or refund the product within a reasonable time frame. It is then the supplier's choice whether they refund or repair/exchange.

If the fault is a major failure you can reject the goods and claim a refund or claim compensation for the loss of value. Damages may also be available if they are reasonable foreseeable.

If you think there has been a breach of guarantee and the supplier rejects your claim, contact your state Consumer Affairs Office for further advice.

Claims against manufacturers

A consumer's claim in the past against a manufacturer was limited usually to the written warranty. But the Australian Consumer Law has changed this.

The consumer guarantees mentioned in this fact sheet apply to the retailer AND the manufacturer. So think twice before you pay extra money for an extended manufacturer's warranty as you may be paying for something you already have!

Unfair termsA term of a standard form contract may be invalid if it is found to be unfair under the Australian Consumer Law. Standard form contract is defined – in simple terms it means a “take it or leave it” contract – eg a phone contract.

The law gives examples of what may be considered unfair. It includes:

a term that penalises one party ( not the other) for ending the contract;

a term that limits the right of another party to sue the other

a term that limits the evidence that one party can use in legal proceedings. etc